Theme：Multihoming and oligopolistic platform competition

Lecturer: Tat-How Teh, The Chinese University of Hong Kong (Shenzhen)

Time：2022.06.14 14:00

Site: Tecent meeting 750-561-651

Abstract:

We provide a general framework to analyze competition between any number of symmetric two-sided platforms, in which buyers and sellers can multihome, and platforms compete on transaction fees charged on both sides. The framework allows buyers and sellers to have heterogenous benefits from using platforms for transactions, and additionally, buyers to have idiosyncratic preferences over using the different platforms. We show how key primitives such as the number of platforms, the fraction of buyers that find multihoming costly, the value of transactions for buyers and sellers, and the degree of user heterogeneity jointly determine the level and structure of platform fees. Even though having more platforms always reduces the total fee charged to the two sides, whether it shifts the fee structure in favor of buyers or sellers depends on whether most of the buyers are singlehoming or multihoming.

Introduction to the lecturer:

Tat-How Teh joined The Chinese University of Hong Kong (Shenzhen) as an assistant professor in economics since September 2021. Prior to that, he studied at the National University of Singapore (NUS) for his PhD in economics. His research interests are platform economics, consumer search, industrial organization theory, and more generally applied microeconomic theory. His work has been published in top academic journals, such as RAND Journal of Economics, American Economic Journal: Microeconomics, and Games and Economic Behavior.